Elders Limited has reported a $38.3 million net profit for the 12 months to 30 September 2015, a significant increase on the $3m profit announced in the previous financial year.
Chief executive officer Mark Allison has attributed the results to strong livestock agency performance, an uplift in retail earnings and increases in feed and processing efficiencies.
Headline results in Elders FY15 announcement to the ASX this morning included:
- Statutory net profit after tax of $38.3m, up $35.3m from previous corresponding period;
- Underlying profit after tax of $32.6m, up $23.5m;
- Underlying EBIT of $45.8m, up $18.2m;
- Return on capital of 21.9%, up from 13.6%;
- Completed $30m hybrid acquisition;
- Added into S&P ASX 300 index.
Elders’ retail arm saw a $3.7 million improvement on last year, due to increased winter crop demand and gains from strategic initiatives such as price book management and the consolidation of our supplier base, according to Mr Allison.
He said a $16.3 million improvement in the agency services business was driven by an increase in livestock prices, and an increase in cattle and wool volumes.
“Improved efficiency and occupancy in Killara Feedlot, along with a refocused business model in China saw a further $3.1 million improvement in the feed and processing services business on last year’s results.”
Mr Allison said strong results from the livestock agency and short haul live export business helped to deliver a strong 21.9% rEeturn on capital compared to 13.6% last year.
He said after seven successive years of debt reduction, FY15 saw Elders reach a level of zero term debt – a key milestone for the business.
“Our hard work and progress throughout the year was recognised by the Turnaround Management Association, which awarded us the Large Business Turnaround of the Year Award.”
“Elders can now focus on directing our cash flow back into Eight Point Plan initiatives – and ultimately reinvigorate and strengthen the business to grow earnings and returns,” Mr Allison said.
“We are focussed on driving efficiency and performance through a range of programs including 90 day branch improvement plans, new retail and livestock channels, branded meat products, and the exploration of new live export markets.” he said.
View Elders FY2015 results presentation here